Class Actions in Canada: A National Procedure in a Multi-Jurisdictional Society? A report prepared for The Globalization of Class Actions Conference, Oxford University, December 2007 ♦ W.A. Bogart, Jasminka Kalajdzic and Ian Matthews This paper follows the question and answer format stipulated by the conference organizers. 1. As background for consideration of the context within which your country’s group litigation operates, please briefly describe your civil litigation system (e.g. common law, civil law)? Canada is a bijuridical, bilingual nation but one dominated by the common law and adversarial system. For most of the provinces and territories English is the main language and they follow the common law system as inherited from Great Britain through the period of colonization. However, in Québec the French language predominates and the legal system is heavily influenced by civil law as inherited from France through that period of colonization. Nevertheless, Québec has adopted aspects of the adversarial (rather than the inquisitorial) system regarding its procedures for civil litigation, in general, and class actions, in particular.1 There is also a Federal Court of Canada with jurisdiction throughout the country. It is a bilingual and bijuridical court; for example, its rules of practice are influenced by those of all provinces and territories, including Québec. For a number of reasons, however, the Federal Court has limited subject matter jurisdiction prescribed by statute and confined, for example, to actions against the federal government, those involving admiralty issues, ♦ W.A. Bogart, Professor, Faculty of Law, University of Windsor; Jasminka Kalajdzic, Sutts, Strosberg LLP and Adjunct Professor, Faculty of Law, University of Windsor; Ian Matthews, class of 2007, Faculty of Law, University of Windsor and Student-at-Law, Osler, Hoskin & Harcourt LLP. The Authors are grateful to the following individuals for their comments, assistance and insight into this paper: Chief Justice Warren Winkler, Court of Appeal for Ontario; Denis Ferland, Professor titulaire, Université Laval, Faculté de droit; Ward K. Branch, Branch MacMaster; Donald B. Lebans, Branch MacMaster; Eric Gertner, McCarthy Tétrault LLP; Michael Carabash, B.A., LL.B., M.B.A. (Osgoode); Benjamin Alarie, Assistant Professor, University of Toronto, Faculty of Law; Margaret Waddell, Paliare Roland Barristers; and Ewan Christie, LL.B. 2008 (Windsor). 1 See generally G. Gall, The Canadian Legal System, 5th ed. (Scarborough, Ont.: Thomson Canada Limited, 2004) at 265ff. 2 and certain matters of intellectual property.2 Thus, that Court’s role in civil litigation, in general, and class actions, in particular, is circumscribed. The relationship of the Aboriginal Peoples to Canadian law and society, remains unresolved and troubled in many ways. 2. What formal rules for representative or non-representative group litigation have been adopted in your country? Class action procedures have been implemented by almost all provinces and territories, by legislation, and by the Federal Court of Canada, by amendment to its rules of practice. There were halting efforts by some courts during the 1960s and 1970s to expand class actions in response to various pressures from consumer groups, competition advocates, environmentalists, etc.3 Québec then led the way legislatively in 1978 when a government of a social democratic caste enacted class action legislation as part of a more general reformist agenda.4 In the rest of Canada, reform efforts regarding class actions during the late 1970s-1980s were led by the Ontario Law Reform Commission (“OLRC”). It published a massive three-volume report in 1982 advocating broad legislative change.5 Reform efforts were further aided by a very restrictive ruling of the Supreme Court of Canada in 1983 that essentially closed the door on judicial expansion of class actions.6 The judgment made clear that any change regarding class actions would have to be accomplished through legislation. There followed a period during which inertia and opposition to class actions succeeded in keeping reform efforts at bay. Such opposition was both philosophical (class actions inimical to essentials of the judicial function) and led by interests threatened by the shift in power change could bring (class actions will harm the business community).7 However, during the same period, a bill of rights, the Charter of Rights 2 Peter W. Hogg, Constitutional Law of Canada, 5th ed., loose-leaf (Scarborough, Ont.: Thomson Canada Limited, 2007) vol. 1 at 7-26–7-27. 3 The history of the developments are recounted in detail in W.A. Bogart, “Questioning Litigation’s Role – Courts and Class Actions in Canada” (1986-1987) 62 Ind. L.J. 665. 4 Ibid. at 685–690. 5 Ontario Law Reform Commission, Report on Class Actions, vol. 1, 2, 3 (Toronto: Ministry of the Attorney General, 1982). One of the authors of this paper, W.A. Bogart, was a consultant to the Commission during the currency of the class action project. 6 Naken v. General Motors of Canada (1983), 144 D.L.R. (3d) 385 (S.C.C.). 7 For philosophical objections, see P. Glenn, “The Dilemma of Class Action Reform” (1986) 6 Oxford J. Legal Stud. 262 and T. Cromwell, “An Examination of the Ontario Law Reform Commission Report on Class Actions” (1983) 15 Ottawa L. Rev. 587. For harm to the business community, see W.A. Macdonald, Q.C. & J.W. Rowley, Q.C. “Ontario Class Action Reform: Business and Justice System Impacts – A Comment” (1984) 9 Can. Bus. L.J. 351. 3 and Freedoms,8 was entrenched that significantly expanded the power of courts. The Charter bolstered acceptance of a more activist court, an essential ingredient of a successful class actions procedure. In the early 1990s an activist Attorney General broke the logjam through a brokering process involving many of the main interests to be affected by reform.9 The Ontario legislation was passed in 1993 followed by the British Columbia legislation in 1995. The Ontario and British Columbia legislation spurred on reform efforts in the latter part of the 1990s in other provinces and in the Federal Court. Such efforts were further encouraged by a Supreme Court of Canada judgment in 2001 that promoted legislative change and that effectively read the approach of such legislation into the unreformed rules addressing class actions.10 By the early 2000s almost all of the provinces and the Federal Court had achieved comprehensive reform of class actions.11 Class actions procedures apply generally to those actions within the subject matter jurisdictions of the courts. For the provinces and territories, this subject matter jurisdiction has few limitations.12 In contrast, as previously indicated, the subject matter jurisdiction of the Federal Court is circumscribed.13 Class actions have given rise to a wide variety of claims, including: governmental liability, products liability and mass torts; breach of contract; insolvency proceedings; and, securities, environmental and competition law violations.14 Whether or not a class is certified, of course, depends on many factors. However, Canadian courts have not singled out a particular kind of claim as being particularly problematic for class action treatment. For example, a number of product liability and mass tort class actions have been certified. 8 Canadian Charter of Rights and Freedoms, Part I of the Constitution Act, 1982, being Schedule B to the Canada Act 1982 (UK), 1982, c. 11 [Charter]. 9 I. Scott, “Reforming the System: Consultation and Collaboration” (1990) 24 L. Soc’y Gaz. 42; W.A. Bogart, “Ambiquity” in A. Prejiner & J. Roy, eds. Class Actions in Ontario and Quebec: Proceedings of the First Yves Pratte Conference (Montréal: Éditions Wilson & La Fleur Lteé, 1992) at 3. 10 Western Canadian Shopping Centres, Inc. v. Dutton, [2001] 2 S.C.R. 534. 11 As of 2007, only the provinces Prince Edward Island and Nova Scotia remain without class action legislation. For an earlier overview of the Canadian experience with class actions see Garry D. Watson, “Class Actions: The Canadian Experience” (2001) 11 Duke J. Comp. & Int’l L. 269. 12 Peter W. Hogg, supra note 2 at 7-3. One limitation, however, is that certain statutes stipulate that proceedings must go forward in a representative capacity by law or under another Act: see e.g. Ontario CPA, infra note 16 at s. 37. 13 See response to question 1, above. 14 Ward K. Branch, Class Actions in Canada, loose-leaf (Aurora, Ont.: Canada Law Book, 2007) (Release no. 19, July 2007) at 5-1–5-67. 4 Regarding these kinds of claims, the Canadian courts’ approach appears more receptive than their American counterparts.15 One area where certain courts have shown a reluctance to certify class proceedings is in applications for declarations of constitutional invalidity and of other legal rights, which can typically be resolved through a test case or an individual action for declaratory or injunctive relief, which would then be binding and achieve the same result as a class action or application. Class action legislation applies to both actions and applications. For that reason most legislation is entitled the Class Proceedings Act; “proceedings” being defined to include both actions and applications. Applications are proceedings where the essential facts are not in dispute, there is no need for oral evidence and so forth, and the matter can be determined in a summary way. As a result, some courts have been reluctant to certify class applications on the grounds that it would not be a “preferable” way of proceeding.16 A number of courts have taken a similar position with regard to litigation claiming a declaration of constitutional invalidity of a statute17; there have been more recent cases to the contrary, particularly where money damages are also sought.18 In any event, there have been so few motions to certify applications as class applications that hereafter, the paper will simply refer to “actions” and “class actions”.